Hi Vishal,

You should send another email to Banking Ombudsperson of your region. The ombudsperson if more effective in dealing with such incidents. Had issue with Citi Bank once and got it sorted by Ombudsperson in 48 hours.

Having worked with a credit card company in the past, I do want to deny that not all banks use ”goons”. In fact the process of recovery is monitored very stringently by most credit card companies.

Hope this helps.

Regards,
SG

Note from Rajeev Chandreshaker Member of Parliament From Bangalore

Rajeev Chandrasekhar at 14:46 on 08 May
i was the first person to raise this in parliament in 2006 and the government took the position that RBI had to deal with it..and then RBI came up with this timid ’guideline’ for banks! unless these banks are made liable under law for the conduct of their debt recovery agents , extortion and coercion will continue!

Thanks Vishal for throwing light on this new genre of terror agents.

The violent manner of retrieving debts is blunderous and disturbing.

I think the RBI should frame a policy wherein banks should be ordered to desist from using abusive recovery agents and instead use their own officials for the same.

We saw the collapse of US banking system due to their poor management. The private banks hire such goons for recovery of their loans.

I have met so many recovery agents. The banks have nothing to do with their methods of recovery, they just want the results. They threaten the customers. I have seen such goons beating the owner of vehicles to recover the loan.

The private banks in order to compete with each other provide the loans without any proper inquiry of customer’s credentials.

In fact it’s the result of free hand given to the private banks in the name of liberalization. Government should frame laws to check the functioning of private banks.

Thanks to our public sector banks that majority of Indian people don’t trust these private banks.

Standard Charted is most notorious and unpopular bank in India i to had a very bad experience with them . After reading this article I did a simple google search and found that there are thousands or such cases only with Standard Chartered

http://www.consumercomplaints.in/complaints/standard-chartered-credit-card-c25598.html

i think the RBI to immediately suspend the license of this Bank this will give a good warning to the entire banking system that they cannot take the consumers for granted.
Thanks Vishal For highlighting this in a very creative way

Also do check out another popular Review Site MouthShut.com

this is what they have to say about the bank

http://www.mouthshut.com/review/Standard_Chartered_Bank-167249-1.html

its pathetic I hope the RBI officials are seeing this

Yes, I agree with the above viewpoint and a campaign against such thing. And I strictly condemn the harassment of the senior citizen for the dues that don’t exist. I mean it’s disgusting to know the callousness of police and the banking authorities to provide the elderly man with the solution that he deserve. This is terrorism and therefore can not and should not be tolerated.

However, I have come across the other side of the issue. I know scores of people who have taken loan form the bank for various purposes – starting a new business, buying a new car and so on. After giving a few installments, many of them have stopped giving and also have managed to escape from the Bank authorities. I am just telling a real example, a person known to me have taken loan for a truck, and after a year stopped giving the installment and successfully managed to escape for one good year from the bank authorities. After earning from that truck for a year, he surrendered that truck to the bank authorities saying he is not able to pay the debt anymore. For such people, who knowingly deceive, I think this measure is ok.

One of my friend had the credit card from the SCB and i remember how badly he was threatened by these people to get their installment.

He just missed on one payment and had to suffer a great deal for that.

From that day on i decided to never deal with this bank

I don’t find this concept of hiring goons a very attractive proposition for the banks. If its such a lengthy process to apply for a bank loan or paying the debts back to them then i think its taken into consideration that the person will pay the installments on time and is trustworthy.

As u have mentioned Vinod about the owner of the truck who failed to pay the installments for one year seems to me an exaggerated statement. if that would have been the case then no bank would allow this to happen and legal case will be filed against the person.
And i think Indian police is far better than goons in this business. So i think banks can better ask Police to do the job and no one will then call it a new terrorist outfit.

These banks will ask anyone to apply for the loan and will advertise their loans on TV and elsewhere as if they are really trying to uplift your standard of life through their money but they know exactly what they are doing. they are asking you to apply and if you fail they can get back their money through hook or crook. they understand the fact that the defaulters can escape the legal process but they can not escape the local mavalis they hire to get back their ransom.

I absolutely agree with you Ayushi.
Bank Managers should be prosecuted for using goons for recovery. Default on loan repayment is just a symptom of the real issue, which is, various tricks used by banks to fool unsuspecting consumers into taking unwanted loans & then setting the debt trap for them like leeches.

This is pure extortion. There is literally no difference between banks going to recovery agents and businessmen going to underworld. It’s a hard to break nexus between the recovery companies and the banks. You got to prove that you were actually threatened. In most of the cases it is hard to provide the evidence either, which is one factor behind agents going this far, apart from the high commission they get from banks in case of successful recovery, doesn’t matter how they get it. Anyway, we just need to know our rights. I’ve suggested all my friends to close accounts in the Standard Chartered Bank.

Why can’t there be licensed recovery agents, just like insurance company agents who take care of all bills and dues in a proper manner. Shame on Standard Chartered Bank. Most of the private banks, especially their sales agents, make little investigation while issuing credit cards, just to meet the sales targets, as they know that even if there any case of default, the recovery agents will come to rescue. The practice should be banned. Let us boycott all banks who have ever used or use goons to forcibly recover money.

I’m not surprised. Couple of years back, a penalty of Rs 10 lack was imposed on Standard Chartered Bank by The Delhi State Consumer Commission for harassing and threatening an advocate. The so-called ”muscle-men” abused the person in Delhi and the bank paid the price. But, still there is no stopping; we can still find many similar cases, one right here.

Banks argue that if they will not apply force, the defaulters would never repay. But the case discussed is quite different. It’s repackaged hafta vasuli nothing else.

Really shocking….National banks seems a better option.

Hey, here is an insight. When RBI issued guidelines a few years back regarding these goons here is what Neil Chatterjee, Head, Corporate Communications of Standard Chartered Bank at that time said: “We will abide by the Reserve Bank of India’s (RBI) fair-trade practice code, but we will not do away with any of our recovery agents.’’
The recovery agents are now a part of the banks’ system. Eliminating them might not be feasible, but yes, it should be regulated strictly.
Here are the RBI guidelines, in case you need to know:
* No physical or verbal intimidation or harassment of credit-card users
* Any act intended to publicly humiliate or intrude privacy banned
* Bank responsible for all acts of omission or commission by agents
* Penalty on unsolicited cards issued without consent
* Banks to maintain ‘Do Not Call Registry’

It’s good that the complain has been filed. The action would certainly be taken soon. In a similar case involving Standard Chartered Bank, 2 recovery agents were arrested in delhi. The best part was that the recovery agents posed themselves as inspectors and finally landed up in jail. Actually, recovery agents work with private consultancy services tied up with banks. The banks do not want to dirty their hands and therefore outsource the task.

Not again…once I made payments for a personal loan to the Standard Chartered Bank and tasted the same thing. The bank used the same tactics saying that I have not done any payments and my envelop is lost. Now how can I be held responsible for this? It is bank’s responsibility to take care of the stuff when it is dropped in their boxes. I don’t know how banks find these kinda guys to do the job. They are rude and harass like anything, if things go too far.
I think that’s the main reason Standard Chartered is not the most popular banks.

Hi Vishal,

The main problem is that, as you have pointed out, the RECOVERY GOONS indeed have GOOD TERMS with the police. Hence, the police, in spite of registering an FIR, turns a blind eye towards the issue and the situation worsens for the harassed person.

Your tips are definitely helpful but I’d like to add a couple more points to that list;

1) When the caller gets abusive, it is advisable to speak in his language because he understands that language very well.

2) Whenever you receive any such call, keep the receiver aside and resume your job as if you didn’t receive any call. (Trust me, it works wonders because when he is unable to convey his threats, half his mission is spoiled)

3) When you start avoiding his call, he will come at your doorstep and that’s where he commits the first mistake. This gives weightage to your FIR and also gives you the advantage to call a couple of your neighbors and beat the hell out of him. ( Believe me, in 90% such cases, they stop spending their energy and move to greener pastures).

4) Remember, its a war... and everything is fair in war! I have an example where the harassed person came up with a novel idea and asked the kids in the colony to throw stones at the recovery agent. He came back with two more guys and they received the same treatment. They never returned!

Now for the solution;

Lets pledge to unite and fight with SCB. Everyone will mail a letter to his entire friends/mailing list, requesting the receiver to do the same, and ask for support by banning any kind of association with SCB.

United we stand... and united we can topple SCB!!

The New Yorker has coined the word ”Revolver” for those credit card customers who choose the option of paying only 10 or five per cent of the outstanding and are liable to pay hefty interest ranging from 30 to 40 per cent on the balance amount.

The banking prudent Indians refrain from falling in the trap. Thereby the multi-national banks, in particular the notorious Standard Chartered Bank, (also ICICI Bank, a private sector Bank in India) frequently resort to unethical practices to rob the gullible customers who unfortunately have scant consumer protections in India.

It is good that Vishal Gondal has decided to take a lead to expose the misdeeds of the credit card banks. A comment has suggested to take up the matter with the banking ombudsman. The commentator is correct. We should take up the issues with the ombudsman. My personal experience is that it helps.

I agree with your Views Anil.. Standard Chartered Banks License should be revoked I have sent a mail to RBI myself on the same and request all users do to the same

In my comment I referred to the concept of ’revolvers’. Here I am reproducing the entire article. The link is at the last of this comment. I wishfully wish that the looters at the Standard Chartered Bank read this article and learn a lesson

The Financial Page
House Of Cards
by James Surowiecki
March 16, 2009
In tough times, businesses will do nearly anything to get new customers—look at the big markdowns at retailers and the cheap financing at auto dealerships. But there is an exception to the rule: these days, credit-card companies are trying to get rid of customers. They’re shutting down accounts, shrinking credit lines, and, in some cases, actually paying customers to go away. American Express recently offered some of its customers three hundred dollars if they would pay off their balance and close their account.

This is a pretty startling change of direction for the lords of plastic. For decades, they’ve been deluging Americans with come-ons (in 2007, 5.2 billion offers for new cards were sent out), so much so that, as of 2006, there were nearly 1.5 billion charge cards in circulation. And these cards did not go unused: between 2000 and 2006, even as Americans’ real income was essentially stagnant and their savings rate negligible, credit-card borrowing rose by about thirty per cent. Our willingness to spend beyond our means served the credit-card companies well: their profits jumped forty-five per cent between 2003 and 2008. But while making borrowing easier boosted the companies’ profits, it also increased the risks they faced, risks that started to hit home once the economic slowdown began. According to Fitch Ratings, credit-card chargeoffs—debts that companies determine they will not be able to collect—rose to almost 7.5 per cent in December, up forty per cent from a year earlier. And, as unemployment continues to rise, so, too, will the number of people who are unable to pay their bills.

It’s little wonder, then, that credit-card companies are now scrambling to shed the customers they think are most likely to default, and to limit the amount that others can spend. In effect, they’re trying to follow the advice given by Larry Selden and Geoffrey Colvin in a book called “Angel Customers & Demon Customers.” Not all customers are equal, it turns out: some are tremendously profitable, while others, like the guy who calls customer service six times a day to check his account balance, cost more than they’re worth. To boost profits, you must cultivate the angels and protect yourself against the demons.

That sounds easy enough. But credit-card companies have created a strange business, in which there’s a fine line between good and bad customers. Their best customers aren’t those who dutifully pay off their balance every month; instead, they’re the ones who charge a lot and pay only a little every month, carrying a sizable balance and racking up interest charges and late fees. These are the “revolvers,” and the credit-card business feeds on them. Credit-card companies don’t necessarily want revolvers to pay off their debts; if they did, there’d be no interest or fees to collect. They want their loans to be, in the words of a banking regulator, “a perpetual earning asset.” And they’ve thought a lot about how to keep those interest payments coming. For instance, they used to keep minimum payments relatively high. But, over time, companies started lowering minimum payments, sometimes to just two per cent of the balance. The lower the minimum payment the less people pay off each month and the longer they stay on the hook.

The catch is that while revolvers are the companies’ best customers, they’re also more likely to default, which would make them the worst. That’s why credit-card companies have had to rein in their lending and shed accounts. Since that risks shrinking profits, they’re also trying to get as much as they can out of their existing customers, by doing things like sharply increasing their interest rates. This increase is partly a response to the greater risk of default, but it also takes advantage of the recession. Many cardholders don’t have enough money to pay off their balance in full, so when interest rates rise they aren’t able to just close their account and get a different card. Effectively, they’re captive customers. And since credit-card companies, unlike most lenders, are allowed to change the terms of their loans at any time, people who borrowed a big chunk of money at, say, nine per cent may now be paying seventeen per cent on the loan.

These tactics are not going to improve the credit-card industry’s dismal reputation. They’re also not going to help an economy in recession, since reduced credit lines take away an important cushion for consumer spending, and higher interest rates and increased fees are likely to drive more people to default. But the odd thing is that while less access to revolving credit is a bad thing for us in the short run, having people rely less on credit cards is a good thing in the long run. The easy availability of credit cards encouraged people to live beyond their means—studies suggest that people really do spend more when they can pay with a credit card, and that big credit lines further encourage extravagance. And the high price of credit-card debt meant that billions of dollars in interest and late fees went to credit-card companies instead of to more productive uses. Smaller credit lines and less borrowing make sense. But in the short run they’re going to throw a lot of sand into the economy’s gears.

This is the paradox of deleveraging: it’s good for borrowers to reduce their debt, and good for lenders to be more rigorous in their standards, but when everyone deleverages at once it does real damage. It’s like a drug addict whose dealer cuts him off: it’s good to stop using, but withdrawal is painful. The end of the credit-card boom isn’t going to wreak as much havoc as the end of the housing boom. But it is helping to put a brake on our spending. And, at this point, every little bit hurts.

The link is:

http://www.newyorker.com/talk/financial/2009/03/16/090316ta_talk_surowiecki

The correct link is http://www.newyorker.com/talk/financial/2009/03/16/090316ta_talk_surowiecki

Msg from Rajat Gupta from Linedin

Its such a shame that banks resort to such means.My brother has applied for StanC CC.I have asked him to cancel it.Thx for sharing ur exp.

Such acts are again a symbol of Improper Bank Management in our country and also that customers do suffer a lot due to such unacceptable behaviour from Banks.
Organisations like NGO’s and other Gov. offices need to take proper actions against any company who voilates any of the Consumer or Human Rights.

Good on you Vishal. I’d heard a lot about Standard Chartered and their goon gang. In fact, majority of the complaints received were against SCB and I canceled my card with them back in 2006 as a mark of protest.

BTW Standard Chartered Bank is also accused of Supporting Real Terrorists check this out

Standard Chartered bank accused of diverting money to Mugabe
ndon, Feb 26 (ANI): The British Foreign Office has showed concern over the involvement of Standard Chartered bank in diverting money to the Robert Mugabe-led Zimbabwe Government.

According to The Telegraph, Internal Whitehall emails show the concern at the Foreign Office about the involvement of Standard Chartered Bank in Zimbabwe. The bank is among a handful of foreign banks operating in Zimbabwe and employs 860 people, having 24 branches there.

http://silverscorpio.com/standard-chartered-bank-accused-of-diverting-money-to-mugabe/

Actually, here's where the need for financial education arises. Financial education or money management should be made mandatory for the young, so that responsibility towards money is instilled in them. Another thing would be to regulate the recovery business and ensure banks use only licensed recovery agents.
Now, irresponsible individuals, who default, and believe they can easily get away with it and get another loan, whenever required from another bank, are wrong. What they do not know is that, if they default, the credit bureau will ensure they will not get another loan easily.

I have the experience to work in the bank for some time. Ppl just make hue and cry over the issue without understanding what really the problem is. This certainly not mean I fully in favor of recovery agents but ppl must understand that what you borrow is the money that belongs to the depositors and that is none other than you and me. Therefore, when the borrower defaults in paying back that money, the depositors suffer. And if the bank is trying to recover the borrowed money from you, it is only trying to protect its depositors' money. If the overdue are allowed to be piled up, it is the depositors that will suffer.

Now I think there is a firm need for why not RBI create a frame work involving recovery agents registration and certification from competent authorities. the subjugation of Innocent customers can't be tolerated. And I wonder how the Banks handover the personal details of its customers in wrong hands for wrong reasons. also there is a need to ensure that street side rowdy do not join this stream.

What I will call it is Taliban Banking. Yea, if the banks and the financial institutions are doing so, how are they different than Al-queda or Taliban? And why to blame only the agents, banks also have the black sheep and if you do not keep them happy they screw the happiness out of you. It is illegal for anyone to send goons to recover money and more so banks of all the people. If they want to recover money, they need to go to courts, however long they take to settle cases. If they can’t handle the court cases or longevity, then stop lending money ... stop being in the business if you can’t handle it.

If the recovery agents are unnecessarily bothering you, why not to consult your layer and approach the consumer forum! Ours is a free country and there are ways to deal with such things. However, if you want to avoid such things in near future, avoid dealing with and taking loans form the PVT Banks. Prefer for the nationalized banks and before you do any such business, you should know all the terms and conditions.

I remember one more incident , One od friend appiled for SC cards, he received after one month without pin for activation and never activated the same.

After few months he got surprised of 50k without activation of card.

Not only standC all banks should be regulated and penalised for such acts.

In my experience Standard chartered is the most unethical foreign bank operating in India without any respect for senior citizens and never caring for law of the state. This bank is very well known for their unfair practices.
They are not willing to full fill even, most justified request and just want money from you at any cost and even for their own short comings and mistakes.

The only way to punish these unreasoning banks, which treat customers as milch cows is, to stop using their not only cards but also all products.

The Supreme Court has strongly deplored the practice of banks and financial institutions using ’goondas’ and musclemen to recover loans from alleged defaulters.

But it seems more like a myth or a illusion to feel that we live in a country governed by a rule of law in the country. Anyone can take possession by force. Employ goondas, and do whatever you want”

It not new, banks are hiring musclemen as ”robbers and hardened criminals,” who beat up a consumer for recovering a few thousand rupees, snatching the key of a vehicle and take it away little realising the urgency or emergency of the person.

These goondas insult everyone, humiliate the co-workers and create scenes. They have driven people to commit suicide for a few thousands”

Even ICICI and Citibank belong to the same terrorist category. RBI must take strict action against such banks who harass their customers like this. I saw this movie ’EMI’ starring Sanjay Dutt...they have exactly shown how these banks loot their customers. Must watch it.

I’ve been hearing about such recovery agents being hired by premium banks for a long time now and had also read about RBI’s proposed move to ban banks from hiring such recovery goons. Infact , The Delhi Consumer Commission had fined ICICI bank a whopping fine of Rs 50 lakh for employing ”goons” to recover loan and deplored the practice of the banks intimidating consumers to pay the installments - http://www.financialexpress.com/news/icici-fined-rs-50-lakh-for-employing-goons/236305/ . It’s shocking that this has not stopped yet. How can institutions like banks use such uncivilized tactics to instill fear and terror to their customers? How can the banks not have their records and hold the customers liable for their mistakes.

Standard Chartered bank should be boycotted after all the settelments it’s asking for money after 10 years, any layman won’t keep the full & final records.

I think there should be a 3rd party involvement like any government body when such full & final settlement take place, like we do registration while purchase/lease of property.

This must be a trauma for all who might have gone through this condemning issue. Such issues are not often brought to the innocence of the people. This is an eye opener for every one of us. As we say “NO TO DRUGS”, I believe we should also say “NO TO SCB”. I have gone through the guidelines of RBI, it states RBI can ban such banks/recovery agents if they breach the stated guidelines.
CHECK THE GUIDELINES: - http://www.rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=4141

Exactly, I am sure this was the real case. They would have thought that for any layman its very difficult to keep records of 10 years old loans (which he has fully paid for), and add to this senior citizen.

An abusive goon would be enough to scare them and bullying them to pay ransom, which actually Vishal brother was ready to pay them at one point.

way to go vishal...am sure each reader and commenter alike will be inspired to raise their voice against these goons...bank funded or not

well you’re right; it’s getting out of hand. it looks like another way for these banks to recover losses. literally. and plus as for real terrorism, there are no two ways. they have to be financed by banks, how else do they pay for all those mastermind killer plans?

Recovering money through goons, violence is never ok. Whatever be the case, you just cant harass people.

Cool. I agree, but harassing somebody without any cause is quite different from cheating the banks. However, you’re right, this also shows how lackadaisical are banks in implementing everything they promise.

Isn’t Standard Chartered the same bank which sponsors huge international sporting events like our own Mumbai marathon? Do they get all the sponsorship money by threatning there customers? I think people always hesitated to use credit cards in india, after such experiences would anyone get a SC CC?

And what about those people who just take loans to fool people only. What are the options for banks now.

We all now how efficient our courts and police are.

Standard Charted and other banks like these are the worst banks in india and deserve to be shut!

dude we do completely understand what u say, but out here they’re askin money which is already paid... n the issue out here is they are askin it in a wrong way that too to a senior citizen!

MRTPC (The Monopolies and Restrictive Trade Practices Commission) in 2006 has issued a notice for fraudulent and false commitments to Standard Chartered Bank.
http://www.financialexpress.com/news/mrtpc-issues-notices-to-major-foreign-banks-for-fraud-and-false-promises/186042/

Now, the false commitments are not working so they opted for another way to stay in business ”FALSE RECOVERY” or in a simple word”EXTORTION”.

MRTPC (The Monopolies and Restrictive Trade Practices Commission) in 2006 issued a notice aginst SCB for false and fraudlent commitments. http://www.financialexpress.com/news/mrtpc-issues-notices-to-major-foreign-banks-for-fraud-and-false-promises/186042/
Now, the false commitments are not working so they started another way to stay in business “FALSE RECOVERY” in simple words “EXTORTION”.

Looking at the traffic on this site alone makes me feel that StanChart has served its life in India. Recovery procedures if applicable have been defined by the governing bodies and agreed to by these very bankers, so its pratically impossible to believe that they would not know of the procedures followed by these so called recovery agents. Its just so sad that these very inhumane recovery agents may be harassing people who do not have the means to reach people for advise and help and end up paying to get rid of the misery. Have read newspaper articles where people have committed suicides unable to withstand the torture that the recovery agents put them through.

Hope these banks realize that the customer base that they are destroying by one negative / bad decision is costing these very banks tons of money.

Would advise all of my friends who use this bank for the cc facility to follow this asap and try to get out while its still possible to. So many ppl frustrated with the kind of service and their total ignorance to the law of the land makes it a unpleasurable exit.

Sure if you read the article before writing this comment you will surely know the story.

Letters have been written to Standard Chartered, notices have been sent ...

Rajathi, If I understand you correctly, you mean that if some goons contracted by big banks are abusing me or threatening me mercilessly, for some payment which I already had paid in full 10 years ago, I should keep my silence and either pay the extortion fees or try sit with the banks in utmost peaceful manner while kept on haunting by the agents.

And your second comment about jobless journos.

I don’t see any journos here, all I see is someone whose father, a senior citizen threatened wrongfully by the goons employed/contracted by bank making his voice heard.
It’s a high time when people should get united in exposing these so called MNC banks and take them to the task. New Media is perfect platform. Gone are the days when, one had no option but to succumb to the extortions by big banks.

I applaud Vishal in taking up this bank to the task and exposing them publicly.

I do support Vishal as the story states that he is really pissed off and is facing the trauma. I also understand that this is not a campaign but this is awareness to our fellow citizens. You are right that no one has the right to flee away with someone’s hard earned money. But, if someone is giving the evidence of his innocence then he/she has no option to raise his/her voice and same is done in this particular case.

I do support Vishal as the story states that he is really pissed off and is facing the trauma. I also understand that this is not a campaign but this is awareness to our fellow citizens. You are right that no one has the right to flee away with someone’s hard earned money. But, if someone is giving the evidence of his innocence then he/she has no option to raise his/her voice and same is done in this particular case.

Rajathi

From the tone of your talks, it looks like you have been suffering a lot because of the recession and have taken up this temporary PR job at StanChart.

Anyway, I pray that you do your job well. However, it is always nice to exercise your eyes and ears before delegating the thinking process mid-way to your tongue. It creates blunders, nothing else.

Vishal’s article is as clear as anyone can put it. I’m surprised how you missed the idea.

As for your comment on jobless journos, Ankit has already replied you. In addition, I want to tell you that starting a web campaign is not the easiest thing... you try starting one and you will realize that its not everybody’s ballgame...it needs ability to generate support.

Anyway...